REC Share Price Slipped Over 3% After Management Degraded AUM Guidance

On May 14, 2025, the REC share price witnessed a fall of over 3%, reaching a day low of ₹388.60 at 1:10 PM, after opening at ₹403.25 on BSE. The drop in REC share price came after the state-run Maharatna PSU revised its growth forecast for Assets Under Management (AUM), trimming its guidance to 11–13% from the earlier projection of 15–17%. The update was shared during the company’s earnings call held on Wednesday, May 14.

Management Optimism on Long-Term Growth

Despite the downward revision in AUM growth, the management remains optimistic about long-term expansion. REC is now aiming for a loan book of ₹10 lakh crore by 2030, underpinned by an expected annual growth rate of 12%.

The company also reaffirmed its margin outlook, projecting that net interest margins will remain steady in the range of 3.5% to 3.75%.

In a significant move toward strengthening asset quality, REC’s management announced its goal to achieve a net-zero Non-Performing Assets (NPA) status by the financial year 2026.

In its recently announced March quarter results, REC reported a 5.5% year-on-year increase in net profit to ₹4,236 crore. Meanwhile, Net Interest Income (NII) rose sharply by 37.6% YoY to ₹5,877 crore, reflecting robust operational performance.

The company’s board has proposed a final dividend of ₹2.6 per share, bringing the total dividend for FY2025 to ₹18 per share.

JV with BHEL

Additionally, REC has approved the formation of a joint venture between its wholly-owned subsidiary and Bharat Heavy Electricals Ltd. (BHEL). The JV will focus on the development of renewable energy, power, and infrastructure projects, aligning with REC's broader strategic push into clean energy and infrastructure financing.

REC Q4FY25 Performance

Rural Electrification Corporation (REC) Ltd. announced its financial results for the March quarter (Q4FY25) on Thursday, May 8, posting a robust 5.6% year-on-year increase in consolidated net profit to ₹4,309 crore. This compares to a net profit of ₹4,079 crore reported in the same quarter of the previous fiscal. The company’s Net Interest Income (NII) also saw significant growth, rising 38% year-on-year to ₹5,877 crore, up from ₹4,273 crore in Q4FY24.

Also Read: Best PSU Stocks in India for May 2025

Conclusion

The strong quarterly performance highlights REC’s continued momentum as a leading financier in the power sector, driven by solid loan book growth and improved interest income.

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